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Max Andrews accepted an offer for his London apartment last December that was 16 percent less than his asking price, and then made a bid on another home.
Days before Andrews was scheduled to close, the purchasers said they would only buy at an even lower price, now 25 percent below the 285,000 pounds ($547,000) he'd originally wanted. The bid meant Andrews couldn't afford to move, so both deals collapsed.
``Everything fell through, leaving me stuck up the creek without a paddle,'' said Andrews, a 38-year-old art assessor. ``It was awful.''
Andrews joins the ranks of victims of ``gazunderers'': buyers who pull out of a purchase or slash the agreed-upon price at the last minute. The practice, which real-estate agents and lawyers say has grown in the last year, is a byproduct of the downturn in the British housing market.
Gazunderers feed on pessimism. The property market in London had the most widespread price drops in at least 14 years last month as banks cut back on lending, the Royal Institution Of Chartered Surveyors said today.
Property transactions in England are binding only when buyers and sellers exchange written contracts. Almost three months pass on average after an offer is made and accepted and before the formal exchange, according to government figures.
Playing the Market
That provides plenty of time for individuals as well as real-estate professionals to play the market long after the original deal is agreed to.
For example, Christian Blavier, a sports-massage therapist who supplements his income by buying and selling property, bid 320,000 pounds to purchase a three-bedroom home in London's Hoxton district. The elderly seller accepted. As property prices slumped, he cut the offer by 30,000 pounds. She refused, and he is looking for another property.
``I've just gazundered a 70-year-old lady who is undergoing a hip replacement,'' said Blavier, 39. ``You can't get a scenario to make you feel more guilty. But this is not my hobby. It's what helps me make a living.''
Today's report from the chartered surveyors' group showed that the number of residential property agents and surveyors saying prices fell in London exceeded those reporting gains by 94 percentage points in April. The reading for the country fell to minus 95.1, the least since the series began in 1978. |
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